Coronavirus: wealthy Chinese families say pandemic has eroded appetite for overseas schooling and investing
- Chinese families have had their desire to emigrate, educate their children, or invest abroad damaged by the coronavirus
- Economic uncertainty, Western responses to the pandemic, as well as rising anti-China sentiment in parts of the world are causing rich Chinese to reconsider plans
The coronavirus pandemic could permanently change wealthy Chinese families’ plans to send their children to study abroad or to use investment vehicles to emigrate overseas, according to a series of interviews with families in the mainland.
A mix of pandemic-based problems for China’s urban rich, including the sudden uncertainty over future incomes, the health risks of living abroad, and China’s deteriorating image in Western countries, have forced many to reconsider, if not totally give up, plans to send their kids to American or British schools, or to buy property in Canada or Australia.
“Many of us are very surprised by how poorly some advanced countries in western Europe have handled the epidemic. We always thought that both the quality of life and health in Western societies were far better than in China, but now our views have changed,” Alice Tan, who runs a tea trading firm in Guangzhou, wrote in a chat group of over 300 members.
The group chat on Chinese social media platform WeChat was created to share information on studying and investing abroad, common pursuits for wealthy Chinese families before the pandemic.
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Among group members, the desire to live overseas has been dampened in recent months, Tan said. In particular, the recently popular idea of sending underage children to study abroad has been abandoned, she added.
Changes of heart from people like Tan and her friends - who, like many middle class Chinese, mostly get their news on the pandemic and the economy from official state media sources - could lead to a collapse in the levels Chinese students and investors going abroad.
A 2018 survey of 224 affluent Chinese investors conducted by the Hurun Report and Visas Consulting, a firm helping Chinese people invest and live abroad, found that the US was the most desirable destination for migration, followed by the UK, Ireland, Canada and Australia.
The survey found that education was the top reason for migration, followed by ecological reasons, food security, health care, social welfare and safety of assets.
More than 660,000 mainland Chinese students studied abroad in 2019, up 8.8 per cent from a year earlier, according to the Ministry of Education.
Bill Liu is a Guangzhou-based agent helping wealthy Chinese citizens emigrate and buy property overseas, and he is seeing big trouble down the road.
Last year, I helped about 30 families emigrate and invest abroad, but this year I’m afraid it will be only 10 or less
“In addition, the death rate, economic shutdown and recessions in America and Europe have had a great psychological impact on China ’s middle class, discouraging their interest [in moving].”
Chinese parents sending their children to study abroad are also increasingly anxious.
“I cannot help but worry about whether my son will be discriminated against in the foreign school – whether he can get the same respect and opportunities compared to a few years ago,” said Gou Hua, a Shenzhen resident whose son is planning to take his Freshman university year in California this autumn.
“It casts a psychological shadow for us. We originally planned to send our 7-year-old son to Canada for junior school next year or the year after. I had hoped he would adapt to the Western environment from an early age,” said Jade Zheng, who owns several flats in Shenzhen and runs a cafe.
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“However, the economic impact of the pandemic has made us pessimistic about the family income over the coming few years, so we plan to postpone and keep him studying in Shenzhen until at least high school,” said Zheng, adding that on a recent visit to Toronto, she found that its appeal had faded since her days studying there in the early-2000s.
“Over the past a few years, my friends and I had wanted to sell properties in Shenzhen and buy in Australia and Canada, but now we are less eager,” she said. “The property market in Shenzhen has doubled or even tripled in value over the past few years. But real estate in Europe, America and Japan appears to have limited room for appreciation.”
The Chinese government has many problems, but the pandemic makes me feel that foreign countries’ governments have even bigger ones
“The Chinese government has many problems, but the pandemic makes me feel that foreign countries’ governments have even bigger ones.”
Shen, whose family owns four flats in Shanghai, has spent around US$600,000 on investment and education insurance, said “I still plan to send my two sons to study abroad in a few years”, but added that he would wait and see what the market is like for selling his Chinese assets and replacing them with overseas ones first.
But unlike previous generations of Chinese people who studied abroad and would stay abroad, Shen thinks his sons will eventually come back to Shanghai, where the “properties can ensure our wealth and a better future”. He wants his wife, meanwhile, to buy a flat in Japan for the couple to live in when they retire, rather than invest in the West.
